March 06, 2003

NRA Hopeful House Action This Year Can Rein In Abusive Class-Action Lawsuits

(Washington, DC) Further underscoring the urgent need for litigation reform, the National Restaurant Association today praised the introduction of the Class Action Fairness Act of 2003 by Reps. Bob Goodlatte (R-VA) and Rick Boucher (D-VA). The Association is extremely supportive of this legislation and hopes that with its passage, in some cases, national, multi-million dollar class actions would be moved from state courts to federal courts. "The Class Action Fairness Act offers balanced and necessary improvements to our judicial system by hindering lawyers from shopping around for favorable jurisdictions. Often small businesses are targeted by unscrupulous attorneys for class-action lawsuits not because of their actions, but because they would rather keep these lawsuits out of federal courts for their own personal financial gain," said Steven C. Anderson, president and chief executive officer of the National Restaurant Association. "We applaud the recent actions of Reps. Goodlatte and Boucher for recognizing the need for this legislation, and hope their counterparts in the Senate will do the same." Americans file an astounding 18 million+ civil lawsuits each year in state courts alone. Many small business owners are routinely forced to settle senseless, baseless cases simply because they cannot afford to litigate, or out of fear of unlimited punitive damage awards. Currently, many small businesses, including some restaurants, are named as defendants in multi-state class-action suits by trial attorneys not because they have committed any wrongdoing or are legally liable, but because their state provides a favorable venue. Litigation, particularly improper litigation, imposes a significant burden on small businesses. Anderson said that many restaurants, with an average profit margin of 4%, may not survive a protracted and expensive lawsuit—which is why the National Restaurant Association is committed to addressing these costly and excessive abuses of our judicial system and is pressing for other litigation reform bills, including the "ADA Notification Act" and the "Personal Responsibility in Food Consumption Act." Source: National Restaurant Association